Commonwealth Journal

March 11, 2014

Burnside bides its time on water plant contract

by Chris Harris
Commonwealth Journal

Burnside —

The biggest development to come out of Monday’s meeting of the Burnside City Council was in fact a lack of action.
An expected vote to award a contract for work on the city’s planned water plant renovation was tabled while the City of Burnside waits to see exactly how much more it will have to raise customers’ water bills to pay for the project.
Before the council meeting — rescheduled after being postponed from Monday, March 3 due to severe winter weather conditions — the city held an informal “town hall”-type event too allow for discussion on the water plant project and a potential rate increase.
Most of that time, however, having the council ask questions of Jeff Reynolds, project manager with the HMB engineering firm that is overseeing the water plant overhaul and would be contracting out the work.
The city was looking at a minimum increase of $2.02 to customers’ water bills to help offset the cost  of a $415,000 RUS (Rural Utilities Services) loan obtained through the U.S. Department of Agriculture (USDA). A $63 water bill would be approximately $65, for instance.
Yet, that wouldn’t produce a lot of extra money — only about $80 a month more total, for all customers in town. 
“That only amortizes that loan. That doesn’t do anything if we need any maintenance done,” said Burnside Mayor Ron Jones. “If we’re going to do it, we ought to go two-and-a-quarter, $2.50.” 
Of course, in order to meet mandated guidelines, the water plant will require the fixes — making the issue of whether or not the city is willing to find a way to pay for them moot. 
“If it’s forced on us, we have to fix that water plant. There’s no ifs, ands or buts about it,” said councilor Dwayne Sellers. “The fact that it’s costing more money than we had planned on has got to come from somewhere.”
The project has been in the works for a long time, with discussion on what’s needed to fix the plant and how much it might cost going back to 2011. Only those citizens in the older part of town — about 450 customers — are served by the plant, which is nearly half a century old at this point. The parts of Burnside along Ky. 90 are served by the Southeastern Water Association via Burnside.
Total expected project cost is currently at $890,000. 
The city even considered stopping the production of its own water entirely and buying it from another source. However, the project has moved ahead with an eye to the future. The loan pays for part of that, as does a USDA grant of $333,100. 
Reynolds said that the contractor they had chosen, Herrick Co., out of Lawrenceburg, Ky., has worked with HMB before, and the engineering firm has had “good luck with them.” 
Water plant manager Eddie Hines attended the meeting and confirmed that the station was down to one pump. 
“If we lose what we’ve got now, we’re done,” he said. “Sunday, we had a mechanical failure. It took six hours to fix. We got down to less than 20 percent useable storage. If it had been a weekday, we would have gone dry.”
Responded Sellers, “I’d like to keep (costs) low for everybody ... but the only thing worse than the bill going up is the water going out.”
Councilor Willis Eadens expressed a similar sentiment, given concerns that further repairs down the road could cause an even greater price hike.
“You could raise it $2 and make everybody made today (or) you could raise it $2 now and another 50 cents later, and they’ll be mad twice,” said Eadens. “Might as well take your whipping now and get it over with.”
Given these views, the city decided to hold off awarded a work contract until an actual minimum amount to raise customers’ bills could be stated by HMB, so that the city isn’t having to place additional financial burdens on its citizens again not long into the future.
“We wanted to make sure we didn’t have to back in a month from now and say we have to raise it a little more,” said Jones. “(HMB) had told us $2.76, based on what they were looking at. We’d had an audit down which showed that our expense weren’t as great as what USDA was thinking ... and thought we’d be able to get that down to around the $2.02 (mark), but we wanted to wait.
“We need to raise it above the minimum so that we have something to repairs with,” he added. “If all we do is just raise enough to cover the mortgage, then we’re nowhere as far as day-to-day operations. We wanted it in writing before we award the contract.”
One water-related issue the council did vote on Monday was a change to the city’s water leak adjustment policy. Previously, the city had decided to give its citizens a once-a-year bill adjustment if they had a water leak.
However, said Jones, the city has forgiven approximately $5,000 in money owed for water leaks, placing a substantial cost burden on Burnside.
“So many people had second homes here, and didn’t winterize them,” said Jones. “We can’t handle that. We can’t do $5,000 in two months.”
As such, Burnside councilors agreed to change the policy to an adjustment once every five years, based on 12 months of average usage (as it has previously been). The leak has to be at least 200 percent of what a normal bill would run, with a maximum of a 10 percent adjustment, and for no less than 3,000 gallons.